Energy Transfer 2010 Annual Report Download - page 34

• Some of the directors and officers of ETE who provide advice to us also may devote significant time to the
businesses of ETE, Regency and their affiliates and will be compensated by them for their services.
• Our General Partner determines which costs, including allocated overhead costs, are reimbursable by us.
• Our General Partner is allowed to resolve any conflicts of interest involving us and our General Partner and
its affiliates, and any resolution of a conflict of interest by our General Partner that is fair and reasonable to
us will be deemed approved by all partners and will not constitute a breach of the partnership agreement.
• Our General Partner controls the enforcement of obligations owed to us by it.
• Our General Partner decides whether to retain separate counsel, accountants or others to perform services for
us.
• Our General Partner is not restricted from causing us to pay it or its affiliates for any services rendered on
terms that are fair and reasonable to us or entering into additional contractual arrangements with any of these
entities on our behalf.
• Our General Partner intends to limit its liability regarding our contractual and other obligations and, in some
circumstances, may be entitled to be indemnified by us.
• In some instances, our General Partner may cause us to borrow funds in order to permit the payment of
distributions, even if the purpose or effect of the borrowing is to make incentive distributions.
In addition, certain conflicts may arise as a result of our pursuing acquisitions or development opportunities that
may also be advantageous to Regency. If we are limited in our ability to pursue such opportunities, we may not
realize any or all of the commercial value of such opportunities. In addition, if Regency is allowed access to our
information concerning any such opportunity and Regency uses this information to pursue the opportunity to our
detriment, we may not realize any of the commercial value of this opportunity. In either of these situations, our
business, results of operations and the amount of our distributions to our Unitholders may be adversely affected.
Although we, ETE and Regency have adopted a policy to address these conflicts and to limit the commercially
sensitive information that we furnish to ETE, Regency and their affiliates, we cannot assure Unitholders that such
conflicts will not occur or that this policy will be effective in all circumstances to protect our commercially
sensitive information or to realize the commercial value of our business opportunities.
Affiliates of our General Partner may compete with us.
Except as provided in our Partnership Agreement, affiliates and related parties of our General Partner are not
prohibited from engaging in other businesses or activities, including those that might be in direct competition
with us. Regency competes with us with respect to our natural gas operations. Additionally, two directors of
Regency GP LLC currently serve as directors of LE GP, LLC, the general partner of ETE.
Risks Related to Our Business
We are exposed to the credit risk of our customers, and an increase in the nonpayment and nonperformance
by our customers could reduce our ability to make distributions to our Unitholders.
The risks of nonpayment and nonperformance by our customers are a major concern in our business. Participants
in the energy industry have been subjected to heightened scrutiny from the financial markets in light of past
collapses and failures of other energy companies. We are subject to risks of loss resulting from nonpayment or
nonperformance by our customers. The current tightening of credit in the financial markets may make it more
difficult for customers to obtain financing and, depending on the degree to which this occurs, there may be a
material increase in the nonpayment and nonperformance by our customers. Any substantial increase in the
nonpayment and nonperformance by our customers could have a material effect on our results of operations and
operating cash flows.
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